A new report has suggested that a new ‘pensions dashboard’ proposed by the regulator should be modelled on a version used in Sweden, which allows users to get real-time estimates of their combined pension income across public, private and occupational streams once they retire.
A new report by the Financial Inclusion Commission, published today (11 March), has made a number of key recommendations on what steps need to be taken to ensure a financially ‘inclusive’ society.
The commission calls for the DWP to work with the industry to deliver a pensions dashboard to help people understand their consolidated pension income, as opposed to simply what they have saved, to be modelled on the Swedish ‘Minpension’ system.
Sweden’s version is updated on a regular, near real-time basis for most pension funds, with over 2m people registered on the service from a population of 9.5m and with an annual budget of about £4m.
The dashboard would help people understand the prospective real value of their consolidated public, private and occupational pension income.
This follows the Financial Conduct Authority’s retirement income report, published in December, which proposed new measures including a ‘pensions dashboard’ and an alternative to the existing wake-up pack to help reinvigorate the retirement income market.
The FCA’s report said a dashboard would enable consumers to view all their lifetime pension savings - including their state pension - in one place.
The committee says that the government should also conduct a ‘robust’ evaluation of the government’s guidance service ‘Pension Wise’ to ensure everyone has access to an affordable, objective service that is fit for purpose.
Elsewhere in the report, a number of other key recommendations include that the Treasury should lead a debate on suitable and affordable protection for consumers unable to obtain personal insurance through the market.
Alongside this, the recommendations state that as part of its ‘leadership’ remit, a statutory duty should be placed on the Financial Conduct Authority to promote financial inclusion as one of its core objectives.
It also suggests establishing an independent, industry-funded think-tank to work with consumer groups, tackle regulatory challenges and facilitate innovation, and designating a ’minister for financial health’.
Caroline Rookes, chief executive for the Money Advice Service added that Mas is co-ordinating the ‘Financial Capability Strategy’ for the UK which will provide a framework to align and focus the collective efforts of the sector to improve the financial capability in the years to come.
She said:“We will work closely with the Financial Inclusion Commission to ensure the Financial Capability Strategy builds on the report’s recommendations to boost financial resilience across the UK.”
ruth.gillbe@ft.com
